With the recent real estate boom in Canada, cottages and other vacation properties have increased significantly in value. These properties are now worth substantially more than their purchase price. At death, 50% of this increase value is subject to taxation.
Are you aware of the impact this capital gains tax liability could have on your estate? A lack of proper planning could mean that you family cottage won’t stay in your family. Your estate might need to sell it to pay the tax liability. It’s a ticking time bomb that most people are unaware of and don’t plan for.
What are your options?
A number of different options will provide the cash required to pay this tax liability at death. It’s important to make the best choice for your situation.
- You and your family start saving today
- Your heirs can borrow the required funds from the bank
- Your estate can sell the asset, or
- You can purchase life insurance to cover the growing tax liability.
Best Solution
Life insurance is often the most cost effective planning tool to cover the tax liability at death. Life insurance provides cash to pay the tax exactly when it’s needed, helps ensure your heirs receive what you intended them to receive and puts your mind at rest because you know you’ve taken care of this important issue.
A little planning can ensure that your dream of passing the family cottage to your heirs will be realized.
Martin Grimba – Regional Vice President Estate Planning Assante Estate & Insurance Services Inc.
For more information please contact The McClelland Financial Group at 905. 771. 5200
